The data on foreign investor behavior in the Moroccan investigation cover four years,1985 through 1989. During this period new inflows of FDI that might be structured to take advantage of the permission to allow majority ownership were quite limited, raising the foreign share of manufacturing assets by 2 percentage points, from 13 percent in 1985 to 15 percent in 1989.changes in the share of foreign ownership by sector were centage points in leather, 4 percentage points in scientific instruments, and 3 percentage points in machinery, textiles, and apparel. Only in chemica (phosphates) was there a substantial FDI inflow, with the foreign share ns- points. By far the bulk of the FDI stock had been estab- ing by 7 percentage lished to respond to the earlier minority foreign ownership is regim With the given data, it is impossible to know how much reorientation if a occurred among firms whose operations had been set up prior to 1985 Controlling for firm size, Haddad and Harrison (1993) found that foreign investors did not exhibit higher levels of labor productivity or greate Firms counterparts. ward orientation for most sectors than their domestic demonstrated higher levels of total factor produc with foreign ownership tivity than their domestic counterparts, but the rate of productivity growth show-the was higher for the latter because as Haddad and Harrison domestic firms were better prepared to cope with the distortionary effects of relationship between higher protected markets." There was no significant growth in domestic firms and greater foreign presence in the spillovers suggesting that foreign investment did not bring positive productivity to the host economy. When Haddad and Harrison varied measures of rela- sector, spillovers from foreign investors to domes- Overall, Haddad tive trade protection technology insignificant and gen erally negative and Harrison found that foreign investors did not make a large or dynamic tic firms remained economy contribution to the development of the Moroccan economy.Thus the Rodrik-led contention that a dollar of FDI is worth no more and no less than a dollar of any other kind of investment rests on four years of observing a host economy whose foreign investment base had been built as part of an IS strategy,with no large numbers of new investors arriving and significant trade distortions remaining in place.The 1985-89 Morocco case study would seem to be a less than compelling basis on which to generalize that FDI brings no special benefits to host country growth and welfare.